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  • AUD/NZD fails to hold onto recovery gains following a hawkish statement from RBNZ’s Orr.
  • Dwindling risk sentiment also adds to the pair’s weakness.

With the RBNZ Governor negating possibilities of using unconventional monetary policy tools, AUD/NZD declines below the 21-day simple moving average (SMA) while trading around 1.0720 during early Thursday.

The New Zealand Dollar (NZD) surged across the board after the Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr turned down speculations of a need to use unconventional monetary policy, via Reuters.

Read: Breaking: RBNZ’s Orr: Unlikely to need ‘unconventional’ monetary policy tools, Kiwi jumps

Also adding to the pair’s weakness is a change in risk-sentiment amid a plethora of global trade/political headlines and increasing expectations to witness a rate cut from the Reserve Bank of Australia (RBA). Various banks, ranging from the Australia and New Zealand Group (ANZ) to UBS, expect a 0.25% rate cut by the Aussie central bank during its October 01 appearance.

Meanwhile, odds concerning the US-China trade deal are gaining ground ahead of the next week’s trade meeting between the diplomats.

Given the absence of major data/events up for publishing, pair traders will be all eyes on the trade/political news, while also taking care of the Fedspeak, for fresh impulse.

Technical Analysis

Sustained trading below 21-day SMA needs to conquer 1.0700 round-figure in order to revisit monthly lows surrounding 1.0630. On the upside, 1.0780 and 1.0850 could please buyers if prices rise beyond 1.0750.